Syngenta Sues AltEn for Breach of Contract Due to the Abandonment of its Ethanol Production Facility

On Tuesday, Syngenta Seeds, LLC filed a complaint in the District of Nebraska against AltEn, LLC, Mead Cattle Company, LLC, Green Disposal Mead LLC, Tanner Shaw and Scott Tingelhoff alleging breach of contract. 

According to the complaint, AltEn, Mead Cattle Company and Green Disposal Mead are operated and managed by defendants Tanner Shaw and Scott Tingelhoff, and each company shares a common facility in Mead, Nebraska. 

The complaint states that Syngenta is a Delaware limited liability company that provides treated seeds to companies for the production of ethanol. The complaint further states that treated seeds refers to seeds that have been coated with pesticides that are registered and approved by EPA and the Nebraska Department of Agriculture. Additionally, the complaint states that treated seeds are also regulated by the U.S. Department of Agriculture under the Federal Seed Act. 

The complaint purports that on July, 1 2016, AltEn and Syngenta entered into a Renewable Resource Material Agreement for the sale of treated seed for ethanol production by AltEn, which required AltEn to utilize the seed in a safe and lawful manner, obtain any required permits and to comply with all applicable laws and regulations. As part of the agreement, AltEn submitted documents to the Nebraska Department of Environmental Quality (NDEQ) to use the byproduct of its ethanol production, referred to as wet cake, for biogas production in compliance with the NDEQ, EPA and Federal Seed Act guidelines. 

The complaint alleges that, despite AltEn’s representations in the Renewable Resource Material Agreement and to the NDEQ, the NDEQ discovered several violations in AltEn’s management and disposal of wet cakes. The complaint states that on September 23, 2019, the Nebraska Department of Environment and Energy (which was formally the NDEQ) issued a notice of violation for AltEn’s storage and lack of disposal of wet cake at its facility and on February 4, 2021, it issued a complaint and order requiring AltEn to cease discharge of industrial wastewater from wet cakes. The plaintiff alleges that AltEn, acting at Shaw’s and Tingelhoff’s direction, failed to comply with these orders. 

The plaintiff purports that on February 8, 2021, the defendants stopped producing ethanol and biogas and shut down the AltEn facility. Due to the defendants abandonment of the facility, a frozen pipe on the facility ruptured, spilling out a significant volume of waste materials including wet cakes. The plaintiffs allege that following the defendants’ abandonment of the facility and disregard of orders by various regulatory authority, Syngenta and other seed companies began voluntarily coordinating with Nebraska Department of Environment and Energy on efforts to address conditions at the AltEn Facility and have since spent millions of dollars to clean up the AltEn facility.

Syngenta alleges that AltEn’s failure to follow the applicable federal, state and local laws has caused irreparable damage and brings the following causes of action, breach of contract, breach of warranty, common law indemnity, negligence, unjust enrichment and common law contribution and equitable subrogation against all defendants. For these alleged violations, the plaintiff seeks declaratory relief, consequential, incidental and actual damages, pre- and post-judgment interest, attorney’s fees and costs. Syngenta is represented by Fraser Stryker PC and Hunton Andrews Kurth LLP